Samsung 8% drop drags chip stocks lower
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- Samsung Electronics shares dropped 8% on Tuesday despite quarterly profit exceeding both Nvidia and Apple's, with the company projecting operating profit to jump 1,800% — evidence that beating numbers is no longer enough in the AI era.
- SK Hynix fell about 7% ahead of its planned Nasdaq listing this Friday, where it aims to raise $28 billion in what would be the second-largest share sale after SpaceX's recent offering.
- U.S. memory makers Sandisk and Micron Technology dropped roughly 8% and 5% respectively, while Intel and Applied Materials each fell about 8% and the iShares Semiconductor ETF slumped 5%.
- Memory chip stocks have seen a historic run-up this year — Micron up 220% and Sandisk up 570% — fueled by an AI-driven supply crunch that let producers set pricing, though investors now fear those prices are unsustainable.
- Apple and Microsoft have already been forced to raise consumer prices to offset soaring memory costs, according to the report, signaling the supply crunch is rippling into end-product pricing.
- The selloff was compounded by a report that Chinese AI startup DeepSeek is developing its own chip to circumvent U.S. export bans and reduce dependence on Nvidia.
Why it matters: Samsung's punishment despite topping Nvidia and Apple's profit illustrates that the AI bar has become impossible to clear on results alone — any signal of cooling demand or supply normalization could unwind a rally that has pushed Micron +220% and Sandisk +570% year-to-date. With SK Hynix's $28 billion Nasdaq listing landing Friday and DeepSeek reportedly building a Nvidia alternative, the week's tape will test whether memory's pricing power holds or breaks.
